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In 3.1.8 upd:replaceNode(), it is stated (rule 1b): If the type-name property of parent($target) is xs:untyped, then upd:setToUntyped() is invoked on each element node in $replacement. It's not clear why this isn't done also for attributes. In 3.1.6 upd:insertAttributes, rule 1b, it is done for attributes, and I can't see a significant difference between replace and insert here.
The WG agreed this was a simple omission and the spec will be fixed.